Every dealer is always looking for new and innovative strategies to increase their sales. And while there are many ways to do it, our next guest has taken a slightly unconventional approach with the help of a facilitator placed in the service department, producing stellar results. On today’s show, we’re pleased to welcome in Sam Slaughter, owner of Sellers Auto Group in Farmington Hills, MI.
Sam talks about his own dealership’s use of a facilitator; a designated person with a desk right at the entrance of the service drive whose main responsibility is to greet customers within the minute that they arrive at the dealership. This does two things: avoids the customer wandering aimlessly around the service department, confused as to what their next step is, and it begins to establish a relationship as soon as they enter the dealership. Sam also discusses the current state of the auto industry and some of his own thoughts on President Trump’s threatening tariffs, and what the future of digital retailing holds for the auto industry.
To hear all about this and more watch the full interview above.
[Previously aired 6/18/19]
VIDEO TRANSCRIPT:
Jim Fitzpatrick:
Sam, welcome to CBT News.
Sam Slaughter:
Thanks, Jim. Good to be here.
Jim Fitzpatrick:
So talk to us a little bit about what you’ve got going on at, your dealership. I mean, obviously, dealers are struggling with the wait times in their service centers. Something that we’ve been trying to get our hands around in the industry for quite some time, but I know that you’ve got a unique twist on it. So share that with us, if you would.
Sam Slaughter:
We do, and we’ve been doing it for quite some time and we’ve really kind of honed the process down. But what we use is a facilitator who has a desk right on the service drive, and that person’s job is to greet every customer within a minute of when they drive into the drive. And what that does is two things. First of all, it avoids the customer kind of looking around, trying to figure out where she’s going to go or what she’s going to do. But it also establishes a bit of a relationship right up front. This isn’t a salesperson, it’s not a service advisor. It’s just simply a person saying, “Hey, welcome to Sellers. Thanks for coming in today. How can I help?”
Jim Fitzpatrick:
Out of a hundred customers that come into the service drive, what percentage actually take, I think it’s Chris, you said, take Chris up on that offer?
Sam Slaughter:
About 50% take them up on the appraisal offer. Probably 20% say, “Yeah, I want to go to the next step and learn a bit more.” And we’re selling 15 to 20 cars a month right through Chris.
Jim Fitzpatrick:
Wow. And is Chris then responsible for taking that sale from start to finish or does he TO the deal to somebody inside?
Sam Slaughter:
Yeah, if the customer is ready to talk right then he will walk the customer up and introduce her to a salesperson or if the customer has to get to work or whatnot, they’ll get a phone number and we’ll have a salesperson follow up. It’s interesting, just an anecdote, sometimes Chris says, somebody will call back in the dealership and say, “Hey, I talked to some bald guy out in the service driver about my appraisal. Can I talk to him again?” So customer’s think about it a little bit. Maybe you get home and talk to their spouse and say, “Well, okay, yeah, let’s take a look.”
Jim Fitzpatrick:
Talk to us about your feelings about the current state of the auto industry.
Sam Slaughter:
Well, I keep saying to people, “This is really an exciting time to be a retailer in today’s world.” Margins are shrinking, our workforce is aging. Other things like Carvana and other ways of selling cars, Tesla are coming into the marketplace. But at the end of the day, it is a relationship business and people buy cars from people that they’re comfortable with, so we just try to keep ourselves as current and maybe leading edge on those trends that are changing our world.
Jim Fitzpatrick:
As the owner of a high-volume dealership in your market, what are some of the things that you’re concerned about that might be lurking around the corner facing dealers?
Sam Slaughter:
Well, I think like I say that finding good people is really hard. We got a great economy and that’s wonderful. We’ve got very low unemployment and we don’t have as many young people growing up dreaming about being a transmission technician. So we’re working hard with our local ASAP program and our local high schools and community colleges to bring awareness to people that you really can have a great career in auto sales or auto service.
Jim Fitzpatrick:
That’s right, and NADA says that the industry is going to need about 76,000 technicians over the course of the next three or four years. Are you able to get and attract and keep good technicians at your dealership?
Sam Slaughter:
Yes, we have very low turnover, a lot of longevity and we have, for a long time, opted to grow our own technicians for the most part. So we hire young kids who have an inclination to the business, maybe they already have some training, but we put them through training and they work right alongside one of our veteran techs. In fact, we just hired a young man here about six weeks ago and he’s just so excited to be part of the business and we find that’s the best way to do it.
Jim Fitzpatrick:
Let’s switch gears a little bit and talk about this tariff situation that the president has kind of thrown on the auto industry here lately and what is your feeling on that and what impact do you think that could have on the industry as a whole?
Sam Slaughter:
It’s interesting, I guess the way I feel about that is I’m just always waiting for the next Tweet to see if we’re really going to do a tariff, or we’re not going to do a tariff. I don’t appreciate that as a negotiating tactic. I think there are other ways that we could do that because it really does send ripples through the economy and fear and I just don’t think that’s the right strategy. But I’m not the president either, so I don’t get to vote about that. Obviously, if there are tariffs that affect brands that we sell, that could be a big problem. I’m not really sure in terms of, for example, in our Subaru store, most Subaru’s are now made in Indiana, so will there be tariffs on those or won’t there or what’s the content? I think it’s a very, very complicated situation.
Jim Fitzpatrick:
Switching gears once again, there’s a number of dealers that we’ve spoken to recently that have looked at the Carvana model and said, “Digital retailing is something that we’re definitely going to have to embrace for the future.” There’re a whole generation of people now coming up that think they can buy everything else online and everything else on their app, on their phone, why not a vehicle? And Carvana has kind of shown us that, in fact, you can do that. What’s your take on that and is your dealership preparing to get into digital retailing and sell cars via the Internet?
Sam Slaughter:
My take on that is that we’re going to have to see how that plays out long-term. I think there’s this notion out there that a customer is going to buy a car out of a vending machine and nobody will be there to explain the features or any of that stuff. Customers still want to interact with people. What we have done is really worked on our websites, our mobile apps, our tablet apps to make sure the customer can get as much information as he or she wants through our website. We at this point don’t have a Buy Now button that can seamlessly do that. We introduce a person into that equation and we find that that’s very successful
Jim Fitzpatrick:
Stair-step programs that are offered by OEMs that seem to have gotten out of hand in the industry, and in some cases will make it a retailer or a dealer look foolish among their customers. Some dealers are still in our Pro Stair-step programs because they’ve made a lot of money. While others say, “Yeah, that kind of stuff’s got to stop.” What side do you fall on in there?
Sam Slaughter:
Well, we have made a lot of money on Stair-step programs and so it’s not a scary thing to us. It is frustrating when you don’t make it, but we make it enough times that it’s rewarding. But I think, as you point out, the biggest problem with it is that it really confuses the customer. Because a long-time customer whose been buying cars from us for 10 years, happens to shop at another dealership and they can beat us by $1,000 because they’re at their Stair-step. That just doesn’t feel right to the customer and makes us look bad. It makes the manufacturer look bad. So my hope is that we’ll get away from that and do things a little bit more with the customer in mind.
Jim Fitzpatrick:
Yesterday, we had the pleasure of speaking with a dealer that’s got 18 stores in the northeast and they’re converting all of their stores to one-price selling. While I’ve got you here today, what is your take on the one price sales approach?
Sam Slaughter:
We’ve looked at it in the past. I think it’s a great idea. I think dealers who really have the discipline to embrace it and get their staff to embrace it. I know some dealers who have done it and are very successful at it. We’ve come close to that on our used cars. We do market-based pricing, and we really try to show the customer, actually online, that our car is one of the top two or three values in the market. And so there’s no need to negotiate and customers still, even though they comprehend that they still want, “Well, you can do a little something for me, right?” So we actually have our pay plan set that if you sell the car at the market price, then you get X dollars, and if you have to go below that, you give up some of your commission. So our guys try to really sell the fact that this is the best value car for them for the money. But the customer says, “Well, how about a hundred bucks? Or how about floor mats,” or whatever, and so we do that.
Jim Fitzpatrick:
Well, Mr. Sam Slaughter, owner of Sellers Automotive Group, I want to thank you so much for joining us on CBT News. It’s been very enlightening. Your insight is invaluable to our viewers and such. So thanks again. I really appreciate it. Hopefully, we can have you back on the show to follow up on some of these issues and more.
Sam Slaughter:
Thank you, Jim. Appreciate it.
Speaker 4:
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